Prague, 29 December 1998 (RFE/RL) - As the old year winds down, Western press commentary today touches on two incendiary problems that have troubled the world throughout most of 1998: Kosovo and Iraq. There is also some comment on the European Union's new single currency, the euro, due to be introduced with the new year on Friday (January 1).

WASHINGTON POST: Milosevic can't be a guarantor of peace, only a generator of crisis

In an editorial today, the paper says that, "as Serb strongman Slobodan Milosevic violates the truce in Kosovo more and more flagrantly, attention naturally turns to the dimming prospects for peace in that independence-minded province of Serbia. But just as dangerous to future prospects," the paper adds, "is what Mr. Milosevic is doing to his own people in Belgrade and throughout Serbia. His crackdown against free speech, free press and free academic study only confirms that he can never be a partner in promoting stability in Kosovo or anywhere else in the region."

The editorial continues: "Thanks to a fractured opposition, to his own strong-arm tactics and to the dominance of his political party in economic life, Mr. Milosevic already had managed to squelch most dissent in his increasingly impoverished nation. But in recent months he has moved to stifle any surviving independent voices....Any local newspaper or magazine that doesn't parrot the xenophobic government line is hit with huge fines and forced to close."

The WP also says: "A case in point is Evropljanin, until recently Serbia's best-selling magazine. The magazine ran an article, co-signed by publisher Slavko Curuvija, that criticized Mr. Milosevic. That was enough. The regime imposed a prohibitive fine, seized the magazine's computers, even went after the furniture and other personal property of the magazine's editors. This crackdown," the paper goes on, "began as U.S. diplomats were negotiating with Mr. Milosevic on the subject of Kosovo. 'Every time they deal with him, they abandon us to his mercy,' notes Mr. Curuvija. 'He can't be a guarantor of peace, he can be only a generator of crisis.'"

ALLGEMEINE ZEITUNG: Serb troops always find an excuse to attack

In Germany, several papers comment on Kosovo. The Allgemeine Zeitung, published in Mainz, says that "Serbian troops will always find an excuse to attack. The Serbs use their iron fist simply to demonstrate who is the stronger in the region, be it in Kosovo today or, earlier, in Bosnia."

The paper's editorial adds: "An attack during Christmas time, of course, had an additional surprise effect. Today it's obvious that the Organization for Security and Cooperation in Europe (OSCE) was right in sending its own monitors to supervise the peace accord in the troubled Serbian Kosovo province."

FRANKFURTER RUNDSCHAU: The OSCE could be caught between two fronts

The paper writes that "the Serbs are holding the OSCE responsible for the advances made by the Kosovo Liberation Army (UCK) during the last two months. And the Kosovo-Albanians are blaming the OSCE for not defending them against revengeful Serbian police forces. The OSCE monitors," the paper's editorial observes," could be caught between fronts quicker than you think."

STUTTGARTER NACHRICHTEN: NATO won't challenge the Russians with an intervention in Kosovo

According to the paper, "the shaky truce negotiated by U.S. representative Richard Holbrooke only lasted for a couple of months. Now," the paper says, "the tanks are rolling in Kosovo again. Civilians are fleeing through the snow. And the separatist Kosovo-Albanian UCK forces are inching forwards."

The editorial continues: "The Serbs, too, feel they have no reason to hold back. Because, following the Anglo-American bombing in Iraq, NATO would think twice before challenging the Russians again with an intervention in Kosovo."

WIESBADENER KURIER: Milosevic has not won a single war

The paper believes that "separatism in Kosovo is a direct result of the violence committed by Belgrade. President Milosevic has not won a single war," it says. "But his policy makes peace impossible."

The editorial goes on: "With new clashes coming up, the chances are dwindling for Kosovo-Albanians to gain autonomy within Serbia. No Serbian politician can be expected to give up what is called the historical heart of the country. Should NATO intervene in Kosovo, the Alliance certainly would have to face a very dangerous and long drawn out mission," the paper concludes.

AKTUELT (DENMARK): The West must decide whether to support the Albanians or Serbs

In Copenhagen, the daily comments: "In 1998, Kosovo became the parking lot for the world's bad conscience. Nightmares, however, do not make for good solutions. Some 2,000 OSCE observers have been dispatched to the province to monitor a cease-fire which looks perfectly all right, except from the stand-point of the warring parties."

The paper's editorial continues: "The Kosovo crisis has simmered for a decade and will certainly flare up again. The West must decide whether to fully support the Albanians' fight for independence or the Serb's right to keep their country in one piece."

"This is an uneasy choice but the West has no time left," the paper concludes. "Since last March, hundreds of Kosovo Albanians have been killed and 200,000 have been rendered homeless. They are impatiently waiting for the West to make a decision. Neither bad conscience nor the 2,000 international monitors can undo the need for this [decision]."

GLOBE AND MAIL (CANADA): Saddam may be crazy, but he's no fool

Turning to Iraq, the daily entitles its editorial today "Smart Bombs, Wilier Saddam." The paper says: "Saddam Hussein is evil: How else do you describe a man who gases his own people? Who murders his relatives simply for wanting to get away from him?....He harbors delusions of grandeur, dreams of conquest, homicidal paranoia --in plain English, he may be crazy."

"But he's no fool," the editorial quickly adds. "He plays a fine hand of poker. And he stands a good chance of winning against the fraying, decade-old coalition arrayed against him -- or what's left of that coalition, namely Washington and London."

Now, the paper notes, Saddam "may even be raising the stakes. Yesterday, Iraqi forces fired missiles at American planes patrolling the [so-called 'no-fly'] zones, prompting the U.S. to strike back at the missile batteries. Will the Americans and the British have the stomach to regularly engage in such actions? [Saddam] may be betting that, in a war of attrition in which his people will be the only victims, he can grind down the will to enforce weapons inspections, no-fly zones, even sanctions."

NEW YORK TIMES: The French want to reward Saddam's belligerence

In an editorial, the paper says that the "dangers of relaxing the international grip on Iraq are too great to consider the kinds of changes proposed by France and Russia, including the lifting of sanctions. Unhappily," the paper goes on, "there is no ideal Iraq policy at this point."

The editorial continues: "The French Foreign Minister, Hubert Vedrine proposes to deal with Saddam Hussein by rewarding his belligerence. Mr. Vedrine would dismantle the present United Nations inspection program and replace it with one more acceptable to Iraq's friends on the Security Council, then lift the embargo on Iraqi oil sales...Russia would also like to see the Security Council lighten sanctions."

The NYT concludes: "Any approach to Iraq that depends on Security Council unity is destined to be weak....The U.S. and Britain may soon be left with no choice but to veto a move to reduce or lift sanctions....There is no painless way to deal with Iraq," the paper concludes. "If there were, Saddam Hussein would not have managed to remain in power for 19 years of brutal rule."

POLITIKEN (DENMARK): The UN will be more divided than ever about Iraq

Joergen Larsen writes the major Danish daily that "Iraq has never recognized the [the UN no-fly zone resolution, which the U.S. and Britain are trying now to enforce]. Since there is still some [legal] uncertainty whether the Western powers have the right to uphold this resolution, the UN will probably be more divided than ever as to what to do in Iraq."

Larsen's commentary goes on: "The main point is how --and, indeed, if -- the international community can do anything to stop Saddam from producing weapons of mass destruction, and how --and, indeed, if-- the sanctions against Baghdad should be eased or strengthened."

LE MONDE: The euro is a stabilizing factor in the world

The launch of the EU's Euro on January 1 evokes several comments. In an editorial today entitled "The Anti-Depressant Euro," the French national daily notes that next October the world will mark the 70th anniversary of the Wall Street crash that began a prolonged world-wide depression. The paper asks whether, as some have said, there is any similarity between 1928 and the year that is finishing. It calls the parallel between the two dates "tempting."

The paper writes: "In 1998, a year marked by the contagious Asian financial crisis being caught by Russia and most other emerging markets, there are some similarities [with 1928]. In 1998, world economic growth suddenly fell...The damage has been considerable --with more than a third of the world's population living in recessionary countries."

But with time, the paper says, "the world --and international monetary authorities-- has learned to manage these crises and limit their effects. International monetary and financial cooperation has...made enormous progress. One of the most spectacular and fortunate examples of this successful cooperation," Le Monde concludes, "is the euro...which helped soften the effects of the [1998] international crisis on the EU....An anti-depressant for Europe, the euro is a stabilizing factor in the world. Well-managed, it will be one of the reasons why 1999 will not resemble 1929."

NEW YORK TIMES: The euro will make Europe an economic machine rivaling the U.S.

The paper today writes of the "The Euro's Promise and Peril." The paper's editorial says: "The creation of the euro...is a historic milestone on the path toward European union. It will push European countries to adopt more similar economic policies while depriving individual nations of significant powers they now enjoy. At best, it will make Europe into an economic machine rivaling the U.S. At worst, it will lead to political strife within the Continent."

The editorial continues: "The euro is likely to join the dollar as a reserve currency held by central banks around the world...At the same time, the change is fraught with peril. National governments have given up substantial amounts of sovereignty to make the change, often without real involvement by voters. Only two countries chose to put the issue to popular referendums. It narrowly passed in France and was defeated in Denmark, which stayed out. Other countries approved it through parliamentary votes."

The NYT sums up: "The challenge for Europe will be greatest in the next cyclical downturn. There is a risk that one country or another could elect a government that blames its economic problems on European central bank policies over which it has no control, and threatens to withdraw from the currency union unless changes are made. The rules Europe has adopted say that no country can withdraw from the union once it enters, so such a threat would create a crisis. [But] there is no risk of that in the immediate future."

WALL STREET JOURNAL: Foreign exchange revenue will collapse as much as 70 percent

Finally, a commentary in today's edition by analyst Kevin Mellyn says there is "a euro revolution in the making." He writes: "The arrival of a single European currency, by creating [an] enormous capital market, represents a powerful catalyst for change in [Europe's financial] landscape. Eleven sub-scale capital markets will be consolidated into a market that rivals that of the U.S. dollar....What took a generation to unfold in America will telescope into a few years in Europe because the technology that enabled the revolution in market operations has already been developed by global investment banks in the U.S."

Mellyn goes on: "The euro will knock down most of [Europe's financial] barriers, and [will do so] quickly...because of new technologies that enable greater customer intimacy....These technologies will gain importance as the European market expands with the euro."

The commentary also says: "Of all European sectors, banking and finance will feel the swiftest and strongest impact. To start, firms and individuals will no longer have to pay the high transaction costs of converting one national currency into another....Foreign-exchange revenue, a key component of bank earnings in Europe, is expected to collapse as much as 70 percent [thereby encouraging EU banks to make their profits elsewhere]."